Research problem definition Paper Example | Topics and Well Written Essays - 1250 words

Problem definition - Research Paper Example That is how loyalty marketing, not only in the hospitality industry but also in the whole business market, emerged as being necessary and ideal. Loyalty marketing is â€Å"the management process of identifying ‘best customers’ and utilizing customer data and insight to create, retain and grow profitable relationships.† (ICLPloyalty.com, 2011: p. 1). Loyalty marketing has become a key factor for success in the service industry over the past years (Bolton, Kannan & Bramlett, 2000; Levey, 2005). In such a highly competitive market, service providers in many industries have discovered the importance of customer retention (Shoemaker & Lewis, 1999). They recognize the fact that keeping their customers is just as important as creating them. Loyalty programs have now become so common in the hospitality industry that it is hard to find a business that does not have such a program. It is known that loyal customers make more purchases than non-loyal customers do, and they ar e less likely to switch to a competitor brand just because of price and other special promotions (Shoemaker & Lewis, 1999). The most essential theory of loyalty marketing is that a small increase in loyal customers can bring a significant increase in profitability to a business. Reichheld and Sasser (1990) found that a 5 % increase in customer retention resulted in up to a 125 % increase in profits in nine service industry groups they studied. Moreover, the Harvard Business Review discovered that a company can double its profits by retaining just 5% more of its customers (Maxted, 2005). In the changing global environment, it is not too much to say that all business firms are looking for innovative ways to increase customer loyalty, because customer loyalty has a very powerful impact on firms' performance and it is considered as a major source of competitive advantages (Lam, Shanker, Erramilli, & Murthy, 2004). Loyalty marketers are not just collecting customer data, but they are als o analyzing their customers’ behavior in order to have a better understanding and to make improvements. They want to know what types of rewards the customers are redeeming, what kinds of partner offers appeal to customers, and even the customers' lifestyle or preference. The knowledge that vendors gain from knowing their customers can be expected to bring a better chance of success (Capizzi et al., 2003). Overall, one of the most dominant trends of loyalty programs these days is the coalition model. Companies in different businesses are bonding together in order to share the branding, operational costs, marketing expenses, data, and customers. These multi-merchant loyalty coalition programs offer strong benefits to attract more customers by creating value (Capizzi et al., 2003). For example, hotels are partnering with other airlines, rental cars, restaurants, and even credit card companies and offering loyalty customers more opportunity to earn points and benefits. One of the world's most recognized hotel rewards program, the Marriott Rewards, has partnerships with Boston Coach, Chase, Hertz, Skymall, Air Canada, British Airways, American Airlines, and numerous other airline companies. Members of the Marriott rewards can also earn additional points via the Marriott rewards visa card issued by Bank One (Marriott International Inc., 2011). Another example of this type of loyalty program in the hotel industry is the Hilton HHonors offered by Hilton. Hilton HHonors has more than 55

Madoffs Fraud Case Research Paper Example | Topics and Well Written Essays - 1250 words

Madoffs Fraud Case - Research Paper Example He said that he earned the capital he invested in the business from Far Rockaway as lifeguard earnings. His firm was a major contributor to the growth of Nasdaq and boasts of succeeding in creating a system where brokers who mostly had traded in the New York Stock Exchange could do more business with the Nasdaq. When news that the business executive had been defrauding the investors and that the firm was nothing but a scam went public, it became a shock for most people. The scheme was a well-organized plan by a number of people to convince the regulators, investors, and visitors in the firms’ office that trading was going on while in real since it was not. In fact, there was no trading in the company for most of its life, with Mr. DiPascali an employee, revealing that he discovered that the company was not trading at all since the late 1980s. In addition, the firm also used a program that generated numbers randomly to choose the people to award-trading orders to, which happene d in varying intervals and in different increments. In such a case, it is unlikely for the investors to face charges for being victims of injustice (Efrati, 2009). However, Efrati, (2009) explains that two of the biggest investors in the firm, who had invested and trusted the firm with billions of dollars, got involved in the case, and the prosecution dragged them individually as well as their foundations to court to face charges. Instead of winning sympathy from the prosecutors and the judge, as they faced the charge of conspiring with the managers to defrauding other investors in the company. In a Manhattan court, Peter Madoff confessed among other crimes that he had faked documents and lied to regulators, which helped his elder brother Bernard Madoff to perpetuate the biggest of all investment frauds. The multi-billion dollar fraud scheme, known as the Ponzi scheme, defrauded investors of their invested capital during the collapse of Benard L. Madoff Investment Securities LLC inv estment firm owned by Bernard Madoff. According to his confession in the court, Peter said that the investment sham caught him in shock when his brother told him the truth in the December of 2008 but said that he helped to divert the firm’s remaining funds to friends and family of the Madoffs. The employees forged documents that created a wrong impression of the company as trading and lured them into getting into the contracts and later lost their money. During his confession, Peter apologized for his irresponsible behavior, which is nothing, compared to the number of losses that investors suffered under his watch. For Peter, pleading guilty for his actions did not let him walk free after the judge sentenced him to 10 years imprisonment (Bray & Lauricella, 2009). The sentence also requires him to forfeit all his personal assets that include a Ferrari and more than 10 million dollars in cash. The sentence did not spare his wife and daughter, where he is required to forfeit the ir assets too. According to Peter, Bernard always acted as the boss, without giving his younger brother a chance for dialog. Despite this, he had an option of choosing not to honor his brother’s commands and do the right thing. He contributed to losses estimated at 17 billion dollars, money owned by the company on behalf of the investors, of which he promised to recover 11 billion.